Seven-year property plan would transform economy
Ten years since the madness began in 2004, now is a good time to take stock -- and action
SO HERE it is, 2014 is upon us and an economic recovery is in full swing. Or is it?
As one minister put it, the question is not whether the economy is recovering, but for whom it is recovering. For half a million households in negative equity and a third of a million in unemployment, it is hard to see reasons to cheer in the new year. Which is why the Government should now finish the job it started two years ago. It should never again rely on property or construction (this point needs repeating) but neither can the economy recover without those sectors, and 2014 is the ideal year to design and implement a thorough seven-year plan to get them back to normal.
And 2014 is ideal because it's 10 years since the insanity that caused the crisis began. While imperfect -- competitiveness had been eroded, property prices were modestly overvalued and construction mildly overextended -- 2004 was nonetheless the last year of sanity: government spending in 2004 remained below 40 per cent of GNP; house price growth was in modest single digits; and one in 10 of the workforce was working in construction -- high (the EU average norm is one in 14) but reasonable given large infra- structure spending and a growing population.